The anointed architect of Alaska's next big boom -- a natural gas pipeline -- is reportedly cozying up to the White House.
TransCanada Corp., the once little-known Canadian pipeline firm, is practically a household name in Alaska these days, as the big winner in August 2008 under former Gov. Sarah Palin's Alaska Gasline Inducement Act.
But the firm is also constructing another big (and highly controversial) pipe: the estimated $13 billion Keystone XL oil sands pipeline, which, if built, would deliver crude from Alberta, Canada, to Houston, potentially doubling Gulf Coast refining capacity to 4 million barrels per day. TransCanada also proposes building a spur line from the Bakken oil patch in Montana and North Dakota that would connect with Keystone XL.
What if that's one megaproject too many?
The Hill, a Washington, D.C., publication, reports that Broderick Johnson, a former TransCanada lobbyist with, among others, the one-time chief of staff for late Alaska U.S. Sen. Ted Stevens, has just gone to work on the president's reelection.
The Keystone XL project has provoked a coalition of environmentalists who oppose the 1,700-mile-long pipeline, according to The Hill, "due to greenhouse gas emissions from the oil sands and concerns about potential spills that could harm vital groundwater supplies along the pipeline route."
Meanwhile, the Alaska Pipeline Project -- which also is an estimated 1,700 miles long -- has reportedly stalled, with TransCanada and its partner, ExxonMobil Corp., failing to get commitments from customers who would ship North Slope natural gas down the pipe. TransCanada blames its inability to ink firm agreements on, among other things, a glut of Lower 48 shale gas and uncertainty over what long-term taxes and royalties gas shippers would pay.
And all that has opened discussion about whether the state of Alaska should use some of its billions of surplus revenue -- collected off of oil royalties -- to jumpstart the project.
Constructing an Alaska natural gas pipeline to the Lower 48 has been a priority of the U.S. Congress for more than three decades, since passage of the 1976 Alaska Natural Gas Transportation Act. President Obama has "likewise described an Alaska gas pipeline as 'a project of great potential … as part of a comprehensive energy strategy,'" according to a recent report to Congress. It remains to be seen whether TransCanada's political maneuvering in Washington has any impact on its Alaska project. Thus far, natural gas market fundamentals -- not necessarily national security -- have determined the Alaska gas line's progress (or lack thereof).
TransCanada's Federal Energy Regulatory Commission application to build the gasline is expected next year. Once its FERC application is in, the Feds have 18 months to produce the project's environmental impact study. Construction could begin -- if the gasline project stays on schedule -- by 2016, according to Bill White, a researcher/writer for the Office of the Federal Coordinator for Alaska Natural Gas Transportation Projects.
By way of schedule comparison, TransCanada's much farther along on Keystone XL. On Aug. 26, the U.S. State Department issued a final environmental impact statement, more than 1,000 pages long, on the massive pipeline. Public meetings have taken place in the six states along the pipeline's proposed route over the last eight weeks. Meantime, federal agencies are determining whether the international project is in the "national interest." A presidential permit will be issued or denied by the end of 2011; pending that final determination, construction could begin next year.
White said the processes for an Alaska gasline are very different from those TransCanada has had to undergo for Keystone XL. And TransCanada also has lots of other projects and properties it oversees across North America, generating wind power, warehousing natural gas and maintaining some 35,500 miles of pipeline infrastructure.
Contact Eric Christopher Adams at eric(at)alaskadispatch.com